3q12 disclosure and results
TRANSCRIPT
1
Earnings Release | Conference Call – 3Q12
November 6th, 2012
2
Agenda
Ricardo Ribeiro
Vice President
Carlos Wollenweber
CFO | IR Officer
3Q12 Main Figures and
Operating Highlights
Financial Highlights
3Q12 9M12
Launched PSV% Direcional
R$ million 543 1,157
Contracted PSV% Direcional
R$ million 558 1,139
Sales Over Supply (VSO) % PSV 41.3% 58.5%
Net Revenues R$ million 373 1,024
Adjusted Net Income¹ R$ million 57 161
Adjusted Net Margin¹ % 15.3% 15.7%
Main Figures
3
1. Adjusted by non-cash expenses (Stock-Options Program).
Contracted MCMV Level 1
4
3Q12
2012
MCMV
Level 1
• 6,398 Units Contracted
• PSV of R$ 400 MN
• 10,398 Units Contracted
• PSV of R$ 659 MN
• 26,661 Units Contracted
• PSV of R$ 1,562 MN
Signed Projects in 3Q12
Track Record – Contracted MCMV Level 1
(R$ million)
0
CAGR +87%
2010 2008
522 380
9M12 2011
659
149
2009
Increase in Price Cap versus INCC¹
(R$)
53,835 62,230
Current Price Cap
(National average)
Previous Price Cap
(National average)
+16% INCC in the same
period
8,03%
City PSV (R$ million)
Units
Macapá (AP) 135 2,218
Sobral (CE) 129 2,084
Maracanaú (CE) 136 2,096
1. Inflation index for the construction sector 2. A government program to the very low income segment, previous than MCMV
Deliveries During the 9M12
5
8,338
5,612
1,619
223
609
9M12
112
1,107
2Q12
832
210
1Q12 3Q12
510
223
287
Delivered PSV - Total
(R$ million)
MCMV Level 1
Development
# of Units
Launches versus Deliveries on Development Segment
6
Development – Launches versus Delivery
(9M12 - # units)
4,187
2,768
+51%
Deliveries Launches
PSV
R$ (million) 497 609 +23%
7
Operating Highlights
Launches
Sales
Deliveries
Land Bank
Inventory
Operating Highlights Ricardo Ribeiro
Vice President
Total
(R$'000)
% Direcional
(R$'000)# of Units
Launched
Total Units
(All Phases)
1 Verano Residencial - 3rd Phase July Belém - PA 21,147 21,125 92 539 Medium
2 Residencial Bella Toscana August Belo Horizonte - MG 42,481 21,241 78 78 Upper-Midle
3 Residencial Bella Verona August Belo Horizonte - MG 41,282 20,641 105 105 Upper-Midle
4 Del Rey - Comercial September Belo Horizonte - MG 99,614 79,691 342 671 Commercial
5 Residencial Macapaba - 2nd Phase September Macapá - AP 134,958 134,958 2,218 4,366 MCMV Level 1
6 Orgulho Tropical September Sobral - CE 129,228 129,228 2,084 2,084 MCMV Level 1
7 Orgulho do Ceará 2 September Maracanaú - CE 136,240 136,240 2,096 2,096 MCMV Level 1
Total 3Q12 604,950 543,124 7,015 9,939
Segment3Q12 Projects Date City - State
PSV Units Launched
8
Launches
Launched PSV
(R$ million)
Launched PSV – Track Record
(R$ million)
131+44%
543 +16%
1,157 +30%
9M12
659
497
9M11
1,019
313
575
3Q12
400
143
2Q12
470
259
211
3Q11
377
313
63
1,447
522
CAGR +69%
9M12
1,157
659
497
2011
924
2010
1,067
380
686
2009
783
149
634
2008
710
710
2007
176
176
MCMV Level 1
Development
Project Acquisition
MCMV Level 1
Development
Launches Breakdown
9
PA
MG
15% 14%
11%
11%
9M12
57%
9% 9%
9M11
35%
22%
25%
5%
3Q12
74%
4% 8%
3Q11
83%
4% 13%
Launches by Segment
(% PSV)
MCMV Level 1
Low-Income
Medium
Upper Middle
Commercial
1
2 3 4
AP
CE
5
7
6
Launches by Region - Development
(% PSV)
100%85%
41%
59%
12%
9M12
29%
9M11
50%
9%
3Q12
15%
3Q11
North
Northeast
Southeast
Midwest
Launches by Region - MCMV Level 1
(% PSV)
9M12
60%
40%
9M11
100%
3Q12
34%
66%
3Q11
100%
North
Northeast
Southeast
Midwest
Sales
Contracted Sales
(R$ million)
+30%
558 +25%
1,139 +47%
9M12
659
479
9M11
863
313
461
89
3Q12
400
158
2Q12
448
259
189
3Q11
430
313
117
MCMV Level 1
Development
Project Acquisition
10
10%
1%
9M12
58%
14%
16% 5%
7%
9M11
40%
20%
28%
7% 5%
3Q12
72%
7% 9%
2%
3Q11
73%
11% 11%
4%
MCMV Level 1
Low-Income
Medium
Upper-Middle
Commercial
Sales by Economic Segment
(% PSV)
Sales by Region
(% PSV)
20%19%16%
11%
9M12
54%
23%
4%
9M11
69%
3Q12
34%
48%
3%
3Q11
92%
6% 3%
Northeast
Southeast
Midwest
North
CAGR +76%
9M12
1,139
659
479
2011
1,230
522
708
2010
1,037
380
657
2009
661
149
511
2008
441
441
2007
127
127
Sales Track Record
(R$ million)
MCMV Level 1
Development
11
Sales Speed
3Q12
41.3%
18.7%
2Q12
36.5%
21.2%
1Q12
16.1% 16.1%
4Q11
31.8%
18.5%
3Q11
36.7%
16.0%
With MCMV Level 1 project Without MCMV Level 1 project
Sales-Over-Supply Ratio (VSO)
(Total PSV - %)
90% 3Q11 96% 2%
2%
1%
1%
4Q11 94% 85% 6%
1% 2%
1Q12 83% 10% 51% 22%
2Q12 91% 88% 3%
3Q12 95%
3 M 6 M 9 M 12 M 15 M
7%
14%3Q12
34%
2Q12
14%
1Q12
14%
2011
17%
2010
<2010
Sales by Launching Period - 3Q12
(% PSV – Development)
Sales Speed
(% Units)
66% of the PSV sold in the 3Q12 were units launched
before 3Q12;
21% of the sold PSV were to units launched before 2011.
Total Vile Marabá 2nd Phase
AP (PSV R$ 30.4MM)
Parque Verde
AM (PSV R$ 31.3MM)
Weekend Club
AM (PSV R$ 54.9MM)
Brisas do Madeira
RO (PSV R$ 62.9MM)
Vita Bella Residencial Club
RO (PSV R$ 59.7MM)
Gran Ventura
MG (PSV R$ 47.5MM)
Total
(R$'000)
% Direcional
(R$'000)
1 Gran Ventura July Belo Horizonte - MG 48,446 47,526 199 Medium
2 Vita Bella Residencial Club July Porto Velho - RO 59,733 59,733 352 Low-Income
3 Brisas do Madeira - Towers: 1, 2, 4 and 6 July Porto Velho - RO 62,940 62,940 284 Medium
4 Weekend Club - Towers: A and E August Manaus - AM 68,570 54,856 178 Medium
5 Parque Verde August Manaus - AM 31,373 31,342 192 Low-Income
6 Total Ville Marabá - 2nd Phase August Marabá - PA 30,445 30,442 256 Low-Income
7 Residencial Meu Orgulho - 1st Phase August Manaus - AM 190,598 190,598 3,511 MCMV Level 1
8 Bairro Carioca - Plots: 1, 2 e 3 August Rio de Janeiro - RJ 32,640 32,640 640 MCMV Level 1
Total 3Q12 524,745 510,077 5,612
# Units SegmentDelivered Projects - 3Q12 Date City - State
PSV
12
Delivered Projects - 3Q12
13
Land Bank
59.3% are large scale projects (over 1,000 units)
74.9% are eligible for the MCMV Program
75.1% were acquired by physical or financial Swap
Average acquisition price of 9.1% over PSV
R$ 6.8 Billion
66,559 units
Land Bank by Segment
(% PSV) 100269
6,820 -128
9M12 Launches
497
Review of
Assumptions
Acquired
Land Bank
2011
6,948
Land Bank by Region
(% PSV)
Type of Payment
(9M12 – % PSV)
ES 1.5%
AM 13.6%
MG 38.2%
RO 4.6%
SP 5.6%
PA 13.2%
DF 20.6% GO
1.6%
Swap
83.6% Cash 16.4%
55% Low-Income
Medium
7%
Upper-Midle 35%
Commercial 3%
RJ 1.1%
Land Bank Track Record in 9M12
(R$ million in PSV)
14
Inventory
63% of the inventory was launched after 2011
94% of the units under construction have already been sold
11%
3Q12
2Q12 15%
1Q12 4%
2011
33%
2010 14%
<2010 9%
Finished Units
14%
12% Midwest
Southeast 27%
North 61%
Inventory by Region
( % PSV)
Aging
(% PSV)
Total % Direcional
Under Construction 748,430 638,974 86.0% 2,595 84.2%
Finished Units 115,089 103,699 14.0% 488 15.8%
Total 863,519 742,673 100.0% 3,083 100.0%
InventoryPSV in Inventory (BRL'000)
% # of Units %
15
Financial Highlights
Financial Highlights
Cash Burn and Financing Transfers (“Repasse”)
Capital Structure
Deferred Results
Stock Performance
Financial Highlights Carlos Wollenweber
CFO | IR Officer
16
Financial Highlights
1,024
776
373323298
+31.9%
+25.2%
+15.2%
9M12 9M11 3Q12 2Q12 3Q11
Net Revenue
(R$ million)
332115 103
31%
1Q12
98
29%
4Q11
82
27%
3Q11
72
24%
2Q11
58
23%
1Q11
57
24%
4Q10
48
18%
3Q10
15% +17%
+66%
+71,9%
9M12
321
30%
9M11
187
23%
3Q12
120
31%
2Q12 2Q10
12%
1Q10
10%
MCMV Faixa 1
97,8% Brokerage Fee
1,2%
Management Fee
1,0%
Breakdown of Revenue from Services
(3Q12 - %)
% of Gross Revenue
2011
1,072
806
266
2010
782
668
114
2009
378
365
13
2008
263
255 8
2007
102
102
CAGR +80%
9M12
1,024
705
318
Net Revenue – Track Record
(R$ million)
Development
Services
Revenue from Services – Track Record
(R$ million)
17
Launched PSV - Total
(R$ million)
CAGR +27%
9M12
1,157
2011
1,447
2010
1,067
2009
783
2008
710
Launched PSV - MCMV Level 1
(R$ million)
131
CAGR +9%
9M12
497
2011
924
793
2010
686
2009
634
2008
710
Launched PSV - Development
(R$ million)
0
CAGR +87%
9M12
659
2011
522
2010
380
2009
149
2008
Development MCMV Level 1
Financial Results
9M12 9M11 D %
Units Under Construction 40,679 32,244 26%
Construction Sites 41 33 24%
# of Cities 11 9 22%
18
3Q12
59%
32%
9%
2Q12
55%
35%
9%
1Q12
50%
41%
9%
4Q11
48%
44%
8%
3Q11
44%
49%
7%
2Q11
32%
60%
8%
1Q11
28%
63%
9%
Focus on Industrialization
Units Under Construction by Construction Method
(% of Units)
1 Aluminum mold and concrete walls method
Industrial Construction¹ Concrete Blocks Conventional Structure (Concrete Pillars)
19 1. Gross Margin excluding interest expenses;
310
+28.0%
9M12
274
36
30.3%
9M11
242
218
24
31.2%
3Q12
112
99
13
30.0%
2Q12
99
87
12
30.6%
+13.0%
Gross Profit Interest Capitalised in COGS Adjusted¹ Gross Margin
Financial Results
Adjusted¹ Gross Profit
(R$ million)
Revenue from Services
(R$ million)
+71,9%
9M12
321
30%
9M11
187
23%
% of Gross Revenue
20
Financial Results
1. Adjusted by non-cash expenses (Stock-Options Program).
Adjusted¹ G&A
(R$ million)
Sales Expenses
(R$ million)
73
57
2723
7.1%7.3%7.1%7.0%
9M11 3Q12 2Q12
+17.3% +28.5%
9M12
30
1812
10
3.0%2.4%3.3%3.0%
3Q12 2Q12
+26.9%
+65.2%
9M12 9M11
Sales Expenses % Net Revenue Adjusted¹ G&A % Net Revenue
Adjusted¹ EBITDA
(R$ million)
161151
5749
+6.6%
9M12
15.7%
9M11
19.4%
3Q12
15.3%
2Q12
+16.3%
15.2%
Adjusted¹ Net Income
(R$ million)
Adjusted¹ Net Income Adjusted¹ Net Margin
20.6%23.1%
18.7%
21.9%19.7%
21.3%
179
9M11
+17.9%
9M12
211
3Q12
70
2Q12
71
Adjusted¹ EBITDA Margin Pro Forma
Adjusted¹ EBITDA Margin Adjusted¹ EBITDA
Cash Burn and Financing Transfer (“Repasse”)
21
Cash Burn Track Record
(R$ million)
9M12
-39
163
3Q12
-24
43
2Q12
18
50
1Q12
-33
70
Net of Accounts Receivable from Delivered Units Variation
Cash Burn
Financing Transfers (“Repasses”) Track Record
(R$ million) 319
+48%
+36%
+21%
9M12
170
149 216
78
138
3Q12
136
79
56
2Q12
100
50
50
1Q12
83
40
43
9M11
"Crédito Associativo"¹
SFH
1. The financing transfer happens during the construction period
Net Debt Adjusted By Receivables From Delivered Projects
22
Net Debt
(R$ million – 3Q12)
Net Debt Adjusted By
Receivables from
Delivered Unitsits
Total Debt
787
Net Debt
443
Receivables from
Delivered Units
117
460
Cash and Equivalents
326
3Q12 2Q12 D %
(R$ million) (a) (b) (a/b)
Debt 786.5 626.2 25.6%
SFH 606.2 516.9 17.3%
CRI 101.2 - n/a
Securitization 6.1 25.6 -76.3%
Receivables Assigned 36.8 49.3 -25.4%
Working Capital 20.0 20.5 -2.4%
FINAME and others 16.2 13.8 16.7%
Cash 460.0 342.3 34.4%
Net debt 326.5 283.9 15.0%
Net debt / Equity 23.4% 21.3% 2 p.p.
23
Capital Structure
Debt Breakdown
5.4% Other
Receivables Assigned 4.7%
CRI 12.9% SFH
77.1%
3Q12 2Q12 D %
(R$ million) (a) (b) (a/b)
Consolidated Deferred results (1+2) 573.3 551.4 4.0%
Deferred results - Margin 33.1% 37.2% -4.1 p.p.
Deferred results - Development (1) 286.7 300.5 -4.6%
Margin 40.7% 40.7% 0.0 p.p.
Deferred results - MCMV Level 1 projects (2) 286.7 250.9 14.2%
Margin 27.8% 33.7% -5.8 p.p.
24
Deferred Results
Schedule of Deferred Results
(%)
2%
20%
60%
18%
2015 2014 2013 2012
+14.7%
+4.0%
3Q12
573
287
287
2Q12
551
301
251
3Q11
500
329
171
Development
MCMV Level 1
Deferred Results
(R$ million)
25
Improvement on DIRR3 Float
Number of Investors
(#)
652 +22%
09.30.2012
283
369
06.30.2012
531
214
317
03.31.2012
533
217
316
Investment Funds
Personal Investors
2,799
1Q12
+97%
3Q12
1,193
2Q12
1,419
+135%
Average Trading Volume
(R$ 000)
272
143122
+89%
+123%
3Q12 2Q12 1Q12
Average Trading Volume
(# of Transactions)
7
8
9
10
11
12
13
2-J
an-1
2
6-J
an-1
2
12
-Jan
-12
18
-Jan
-12
24
-Jan
-12
31
-Jan
-12
6-F
eb
-12
10
-Fe
b-1
2
16
-Fe
b-1
2
24
-Fe
b-1
2
1-M
ar-1
2
7-M
ar-1
2
13
-Mar
-12
19
-Mar
-12
23
-Mar
-12
29
-Mar
-12
4-A
pr-
12
11
-Ap
r-1
2
17
-Ap
r-1
2
23
-Ap
r-1
2
27
-Ap
r-1
2
4-M
ay-1
2
10
-May
-12
16
-May
-12
22
-May
-12
28
-May
-12
1-J
un
-12
8-J
un
-12
14
-Ju
n-1
2
20
-Ju
n-1
2
26
-Ju
n-1
2
2-J
ul-
12
6-J
ul-
12
13
-Ju
l-1
2
19
-Ju
l-1
2
25
-Ju
l-1
2
31
-Ju
l-1
2
6-A
ug-
12
10
-Au
g-1
2
16
-Au
g-1
2
22
-Au
g-1
2
28
-Au
g-1
2
3-S
ep
-12
10
-Se
p-1
2
14
-Se
p-1
2
20
-Se
p-1
2
26
-Se
p-1
2
2-O
ct-1
2
8-O
ct-1
2
15
-Oct
-12
19
-Oct
-12
25
-Oct
-12
Sto
ck P
rice
Volume (R$) Direcional
R$ 12,25
26
Shares Performance
27
Disclosure
This presentation contains certain forward-looking statements concerning the business prospects,
projections of operating and financial results and growth potential of the Company, which are based on
management’s current expectations and estimates of the future performance of the Company. Although the
Company believes such forward-looking statements are based on reasonable assumptions, it can give no
assurance that its expectations will be achieved. Expectations and estimates that are based on the future
prospects of the Company are highly dependent upon market behavior, Brazil’s political and economic
situation, existing and future regulations of the industry and international markets and, therefore, are
subject to changes outside the Company’s and management’s control. The Company undertakes no
obligation to update any information contained herein or to revise any forward-looking statement as a result
of new information, future events or other information.
28
Contacts
Carlos Wollenweber CFO | IR Officer
Paulo Sousa IR Analyst
Cristiano Faria IR Analyst
www.direcional.com.b/ir
(55 31) 3214-6200
(55 31) 3214-6450